Instructions For Form 720 - Quarterly Federal Excise Tax Return

Vaccine taxes (IRS No. 97). A tax is imposed on the

Part II

sale or use of a vaccine manufactured, produced, or

entered into the United States at $.75 per dose if it:

Sport fishing equipment (other than fishing rods and

•

Contains diptheria toxoid, tetanus toxoid, pertussis

fishing poles) (IRS No. 41). The tax on sport fishing

bacteria, extracted or partial cell bacteria, specific

equipment is 10% (.10) of the sales price. The tax is paid

pertussis antigens, or polio virus;

by the manufacturer, producer, or importer. Taxable

•

Is against measles, mumps, rubella, hepatitis A,

articles include reels, fly fishing lines (and other lines not

hepatitis B, chicken pox, or rotavirus gastroenteritis;

over 130 pounds test), fishing spears, spear guns, spear

•

Is any HIB (haemophilus influenza type B) vaccine;

tips, terminal tackle, fishing supplies and accessories,

•

Is any conjugate vaccine against streptococcus

and any parts or accessories sold on or in connection

pneumoniae; or

with these articles. See Publication 510 for a complete

•

Is any trivalent vaccine against influenza.

list of taxable articles. Add the tax on each sale during

the quarter and enter the total on the line for IRS No. 41.

If any taxable vaccine is combined with one or more

additional taxable vaccines, then the tax is imposed on

Fishing rods and fishing poles (IRS No. 110). The tax

each vaccine included in the combination.

on fishing rods and fishing poles (and component parts)

taxed at a rate of 10% will have a maximum tax of $10

Example. MMR contains three taxable vaccines:

per article. The tax is paid by the manufacturer, producer,

measles, mumps, and rubella. The tax per dose on MMR

or importer. Add the tax on each sale during the quarter

is $2.25 (3 x $.75).

and enter the total on the line for IRS No. 110.

Add the tax for each taxable vaccine and enter the

total tax on the line for IRS No. 97.

Electric outboard motors (IRS No. 42). The tax on an

electric outboard motor is 3% (.03) of the sales price. The

Foreign Insurance Taxes

tax is paid by the manufacturer, producer, or importer.

Add the tax on each sale during the quarter and enter the

Policies issued by foreign insurers (IRS No. 30).

total on the line for IRS No. 42.

Enter the amount of premiums paid during the quarter on

policies issued by foreign insurers. Multiply the premiums

Fishing tackle boxes (IRS No. 114). The tax on fishing

paid by the rates listed on Form 720 and enter the total

tackle boxes is 3% (.03) of the sales price. The tax is

for the three types of insurance on the line for IRS

paid by the manufacturer, producer, or importer. Add the

No. 30.

tax on each sale during the quarter and enter the total on

Who must file. The person who pays the premium to

the line for IRS No. 114.

the foreign insurer (or to any nonresident person such as

Bows, quivers, broadheads, and points (IRS No. 44).

a foreign broker) must pay the tax and file the return.

The tax on bows is 11% (.11) of the sales price. The tax

Otherwise, any person who issued or sold the policy, or

is paid by the manufacturer, producer, or importer. It

who is insured under the policy, is required to pay the tax

applies to bows having a peak draw weight of 30 pounds

and file the return.

or more. The tax is also imposed on the sale of any part

Treaty-based return positions under section 6114.

or accessory suitable for inclusion in or attachment to a

Foreign insurers and reinsurers who take the position

taxable bow and any quiver, broadhead, or point suitable

that a treaty of the United States overrules, or otherwise

for use with arrows described below. Add the tax on each

modifies, an Internal Revenue law of the United States,

sale during the quarter and enter the total on the line for

must disclose such position. This disclosure must be

IRS No. 44.

made once a year on a statement which must report the

Arrow shafts (IRS No. 106)

payments of premiums that are exempt from the excise

tax on policies issued by foreign insurers for the previous

The tax on arrow shafts is subject to an annual

calendar year. This statement is filed with the 1st quarter

inflation adjustment for any calendar year

Form 720, which is due before May 1 of each year.

beginning after 2005. For 2006, the tax is $.40 per

CAUTION

You may be able to use Form 8833, Treaty-Based

arrow shaft.

Return Position Disclosure Under Section 6114 or

The tax on arrow shafts is $.40 per arrow shaft. The

7701(b), as a disclosure statement.

tax is paid by the manufacturer, producer, or importer of

How to file. At the top of Form 720, write “Section

any arrow shaft (whether sold separately or incorporated

6114 Treaty.” Provided you have no other transactions

as part of a finished or unfinished product) of a type used

reportable on Form 720:

in the manufacture of any arrow which after its assembly

1. If this is your final return, check the final return box.

meets either of the following conditions.

•

2. Write “None” on lines 1 and 3.

It measures 18 inches or more in overall length.

•

3. Sign the return.

It measures less than 18 inches in overall length but is

suitable for use with a taxable bow, described earlier.

You need an EIN to file Form 720. If you do not have

an EIN, see Employer Identification Number (EIN) on

Add the tax on each sale during the quarter and enter

page 2.

the total on the line for IRS No. 106.

Where to file. Mail the Form 720 with the attached

Inland waterways fuel use tax (IRS No. 64). If you are

statement to: Internal Revenue Service Center, P.O. Box

liable for the inland waterways fuel use tax, report the

21086, Philadelphia, PA 19114. Also, see the Caution

number of gallons subject to tax on the line for

under Private Delivery Services on page 2.

IRS No. 64.

Exception. If you are reporting liabilities in Parts I or II

The inland waterways fuel use tax applies at the

(Form 720), follow the instructions for How to file above,

rate listed on Form 720. This is in addition to all

except mail the Form 720 to: Internal Revenue Service

other taxes imposed on the sale or use of the fuel.

CAUTION

Center, Cincinnati, OH 45999-0009.

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Instructions For Form 720 - Quarterly Federal Excise Tax Return - 2006 Page 6

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